September 4, 2015
By Alex Keown, BioSpace.com Breaking News Staff
SAN DIEGO – Vital Therapies, Inc. is slashing 30 percent of its workforce and is cutting expenses in an effort to conserve capital after its late stage liver therapy failed to meet its primary and secondary goals last month.
The layoffs and cost-savings measures, announced Thursday night, comes less than two weeks after Al Kildani, vice president of investor relations at Vital Therapies, told BioSpace that he was unable to comment on any possible corporate restructuring that could result in layoffs due to the trial’s failure.
In August, Vital Therapies announced its cell-based therapy targeting the treatment alcohol-induced liver decompensation failed to meet its primary endpoint of overall survivability of at least 91 days. Trial data showed there was no statistical significance in survivability between the treatment group and the control group, the company said. Secondary endpoints of proportions of survivors also showed no statistical significance. The ELAD System (extracorporeal liver assist device) operates similar to a dialysis machine. An external device filters toxins in the blood that can damage liver cells and transfuses the blood back into a patient’s body. Vital Therapies’ ELAD System had been assigned Orphan Drug Status by the U.S. Food and Drug Administration (FDA) due to the mortality rate of acute liver failure. Currently there are no treatments to prolong survival rates.
Vital’s VTI-208 trial included 203 patients with AILD, also called alcoholic hepatitis. Alcoholic hepatitis occurs when the liver is damaged by the consumption of alcohol, although the amount necessary to consume to develop AILD differs per individual, according to the Mayo Clinic.
Terry Winters, Vital’s chief executive officer, said the preservation of capital is necessary while the company continues to analyze the data of the failed trial and determine if the study can move forward in a new trial “to confirm what we believe to be promising pre-defined subset and post hoc analyses.”
As part of its data analysis and hopes of salvaging its research, Vital Therapies said it is exploring the design of a new Phase III clinical trial, which “may limit subjects based on both Model for End-Stage Liver Disease (MELD) score and age.” Vital Therapies said it does not know if the cost savings measures it is implementing will be able to provide the funding to finance a new Phase III trial. Just a few weeks ago Winters said the company had enough cash on hand to fund Vital through the third quarter of 2016, largely dependent on positive results of VTI-208.
In addition to the VTI-208 trial, Vital Therapies said it will stop two other trials, the VTI-210 study, which included 150 patients and was in late stages of evaluating the ELAD System’s treatment of acute alcoholic hepatitis, and the VTI-212, which was enrolling patients with acute liver failure for a mid-stage study.
With the slashing of its workforce, Vital Therapies said it expects to incur personnel-related severance charges of $1.2 million, primarily in the quarter, which ends Sept. 30.
In June Vital reported a net loss and net loss attributable to common stockholders of $15.1 million for the second quarter, largely due to an increase in R&D costs.
Vital Therapies said that while the trial failed to meet its goals, the company was encouraged by some of the results it had seen, particularly with one cohort of patients with a MELD score of less than 28. Data showed that patients in the trial under 46.9 years of age had a hazard ratio of 0.634 with a log-rank p-value of 0.167, which suggests that future trials may incorporate stratification by age.
has yet to recover from the sharp fall it took after the company announced the failure of the trial. The stock opened at $3.46 per share. It had been trading at $17.64 per share prior to the announcement of the trial’s failure.
